Authorities Respond to Tariff Bomb with "Execution of 100 Trillion Won Market Stabilization Program"

Financial Services Commission - Meeting to Check Financial Situation with 5 Major Financial Holding Companies

Chairman Kim Urges Financial Companies to Play a More Active Role in Supporting Real Sector Funds Such as Corporations

Formation of a Public-Private Financial Policy Council for Real-Time Communication with Corporations

Financial authorities are set to embark on the execution of a 100 trillion won market stabilization program in response to the U.S. imposition of reciprocal tariffs. They are also pushing for the formation of a public-private policy council to deliver the voices of on-site companies to the government in real-time.

Chairman Kim Byung-hwan of the Financial Services Commission, together with Lee Bok-hyun, the Governor of the Financial Supervisory Service, held a meeting to check the financial situation with the heads of the five major financial holding companies, KB, Shinhan, Hana, Woori, and NongHyup, as well as the heads of policy financial institutions at the Government Complex Seoul on the 7th, and announced this plan.

Chairman Kim diagnosed, "In a situation where economic, industrial, and financial market uncertainties are very high at home and abroad due to the U.S. imposition of reciprocal tariffs, it is an important time to stably manage our economy and financial markets for the remaining two months until the next government takes office."

He stated that financial authorities are also fully prepared for the preparation and execution of a market stabilization program worth about 100 trillion won, so that necessary measures such as liquidity supply can be taken at any time depending on market conditions, and existing policies will be pursued without a hitch. The market stabilization program consists of a 40 trillion won bond market stabilization fund, a 10 trillion won stock market stabilization fund, and support for real estate project financing (PF) and the construction industry.

Financial authorities plan to accelerate the creation of a 50 trillion won advanced strategic industry fund, which is being pursued to respond to the trade war and support the sustainable growth of key companies.

Chairman Kim urged the participants, "Financial holding companies and policy financial institutions should play a more active role in supporting real sector funds such as corporations along with stabilizing the financial market." He continued, "Please closely monitor the situation and impact of trading companies on-site and ensure that necessary funding and support are provided in a timely manner."

Financial authorities are pushing for the formation of a public-private financial policy council to more precisely analyze the ripple effects of international situations such as U.S. tariff policies on domestic companies and the economy. The council, which will be composed in various forms from working-level staff to executives, will serve as a communication channel between the field and the government. Chairman Kim emphasized, "If private financial companies and policy financial institutions present problems and improvement ideas encountered on-site, we will promptly review them and actively reflect them in policy."

Reporter Kang Hyun-woo hkang@hankyung.com